Loading...
HomeMy WebLinkAbout2007 06 25 Regular 601 Audit Selection Committe; RFP for Audit Services; Contract for Audit Services COMMISSION AGENDA ITEM 601 CONSENT INFORMATIONAL PUBLIC HEARING REGULAR X Meeting MGR jL/!DEPT 1V\/J Authorization June 25, 2007 REQUEST: To have the Commission authorize: . the formation of a three-member Audit Selection Committee to include one City Commissioner, . the City Manager to issue an RFP (Request For Proposal) for Audit Services in compliance with the Competitive Auditor Selection Procedures set forth in Florida Statutes Section 218.391. . the City Manager to negotiate a contract for Audit Services for review and approval by the Commission. PURPOSE: To authorize the formation of an Audit Selection Committee and to authorize the City Manager to issue an RFP for audit services and negotiate a contract for review and approval by the City Commission. CONSIDERATIONS: . Pursuant to Section 218.39(1)(b), Florida Statutes (FS), a municipality with revenues or the total of expenditures and expenses in excess of $250,000 is required to have an annual audit of its accounts and records by an independent certified public accountant. . Section 4.12 of the City of Winter Springs Charter requires that the City designate an accounting firm annually or for a period not exceeding three years provided that the designation for any particular fiscal year shall be made no later than six months after the beginning ofthe fiscal year. . The City must designate an accounting firm by March 31, 2007 for the FY 07 audit. Due to other required commitments within the Finance Department this process was delayed. . Pursuant to Section 218.391 (2) and (3), Florida Statutes (FS), the governing body of a municipality shall establish an "auditor selection committee" and "competitive auditor selection procedures." Regular Agenda Item 60 1 June 25, 2007 Page 2 of3 . The City's current three-year audit contract with McDirmit Davis and Company, LLC has expired and FS 218.391 does not allow the City to extend the contract unless there are renewal provisions clearly stated in the contract. If there are no provisions for renewal, the City must adhere to the auditor selection process described in this agenda item. FUNDING: An audit fee of$37,500 is currently budgeted in the General Fund divisions 1300 and 1360. The Fiscal Year 2006 audit fee was $30,700 with no single audit required that year. RECOMMENDATION: The Finance Department recommends the: 1. Formation of a three-member Audit Selection Committee comprised of the City Manager (or his designee), a City Commissioner (selected by the City Commission) and the Finance Director. 2. Issuance of an RFP. 3. City Manager negotiate a contract, subject to Commission approval, for Audit Services based on the Audit Selection Committee recommendation. IMPLEMENTATION: Monday, June 25, 2007 (Commission meeting) Finance Director gains Commission Authorization for RFP and City Commission selects a City Commissioner to serve on the Audit Selection Committee. Tuesday, June 26, 2007 Finance Director arranges for general ad in the Orlando Sentinel newspaper, places RFP on Demand Star, and sends out RFPs to those firms currently doing audits for the local cities in Seminole County. Friday, July 20,2007 Proposals due to City from audit firms. Week of July 23,2007 Committee members independently review proposals and prepare rankings. Monday, July 30, 2007 Committee members come together to review the results of the members' independent review of the proposals, and select five firms to make oral presentations to the committee. Tuesday, July 31, 2007 Finance Director schedules oral presentations. Regular Agenda Item 60 I June 25, 2007 Page 3 of3 Monday, August 6, 2007 Auditors give oral presentations to Committee members. Monday, August 6, 2007 Committee selects and ranks three of the five presenting firms to negotiate with. Tuesday, August 7, 2007 City Manager begins contract negotiations, includingfee, with the #1 rankedfirm. If unable to reach agreement, negotiations with the #1 rankedfirm are terminated and negotiations with the #2 firm commence and so forth. If negotiations fail with the first three firms, the committee is free to begin negotiations with the remaining firms in rankinf; order. Monday, August 27, 2007 (Commission City Manager makes recommendation to the meeting day) Commission and gains approval to sign contract for audit services. ATTACHMENTS: Florida Statute Section 218.391 Auditor Selection Procedures Florida Statute Section 218.39 Annual Financial Audit Report Section 4.12 of the City Charter "Independent Audits" Draft RFP COMMISSION ACTION: Statutes & Constitution :View Statutes :->20Q6->Ch0218->Section 391 : Online Sunshine Page 1 of2 Select Year: 2006 l~~J The 2006 Florida Statutes Title XIV TAXATION AND FINANCE Chapter 218 FINANCIAL MATTERS PERTAINING TO POLITICAL SUBDIVISIONS View Entire Chapter 218.391 Auditor selection procedures.-- (1) Each local governmental entity, district school board, charter school, or charter technical career center, prior to entering into a written contract pursuant to subsection (7), except as provided in subsection (8), shall use auditor selection procedures when selecting an auditor to conduct the annual financial audit required in s. 218.39. (2) The governing body of a charter county, municipality, special district, district school board, charter school, or charter technical career center shall establish an audit committee. Each noncharter county shall establish an audit committee that, at a minimum, shall consist of each of the county officers elected pursuant to s. 1 (d), Art. VIII of the State Constitution, or a designee, and one member of the board of county commissioners or its designee. The primary purpose of the audit committee is to assist the governing body in selecting an auditor to conduct the annual financial audit required in s. 218.39; however, the audit committee may serve other audit oversight purposes as determined by the entity's governing body. The public shall not be excluded from the proceedings under this section. (3) The audit committee shall: (a) Establish factors to use for the evaluation of audit services to be provided by a certified public accounting firm duly licensed under chapter 473 and qualified to conduct audits in accordance with government auditing standards as adopted by the Florida Board of Accountancy. Such factors shall include, but are not limited to, ability of personnel, experience, ability to furnish the required services, and such other factors as may be determined by the committee to be applicable to its particular requirements. (b) Publicly announce requests for proposals. Public announcements must include, at a minimum, a brief description of the audit and indicate how interested firms can apply for consideration. (c) Provide interested firms with a request for proposal. The request for proposal shall include information on how proposals are to be evaluated and such other information the committee determines is necessary for the firm to prepare a proposal. (d) Evaluate proposals provided by qualified firms. If compensation is one of the factors established pursuant to paragraph (a), it shall not be the sole or predominant factor used to evaluate proposals. (e) Rank and recommend in order of preference no fewer than three firms deemed to be the most highly qualified to perform the required services after considering the factors established pursuant to paragraph (a). If fewer than three firms respond to the request for proposal, the committee shall recommend such firms as it deems to be the most highly qualified. (4) The governing body shall inquire of qualified firms as to the basis of compensation, select one of the firms recommended by the audit committee, and negotiate a contract, using one of the following methods: http://www.leg.state.fl.us/Statutes/index.cfm ? App _ mode= Display _ Statute&Search _ String=& URL=Ch02... 6/20/2007 Statutes & Constitution :View Statutes :->2006->Ch0218->Section 391 : Online Sunshine Page 2 of2 (a) If compensation is not one of the factors established pursuant to paragraph (3)(a) and not used to evaluate firms pursuant to paragraph (3)(e), the governing body shall negotiate a contract with the firm ranked first. If the governing body is unable to negotiate a satisfactory contract with that firm, negotiations with that firm shall be formally terminated, and the governing body shall then undertake negotiations with the second-ranked firm. Failing accord with the second-ranked firm, negotiations shall then be terminated with that firm and undertaken with the third-ranked firm. Negotiations with the other ranked firms shall be undertaken in the same manner. The governing body, in negotiating with firms, may reopen formal negotiations with anyone of the three top-ranked firms, but it may not negotiate with more than one firm at a time. (b) If compensation is one of the factors established pursuant to paragraph (3)(a) and used in the evaluation of proposals pursuant to paragraph (3)(d), the governing body shall select the highest-ranked qualified firm or must document in its public records the reason for not selecting the highest-ranked qualified firm. (c) The governing body may select a firm recommended by the audit committee and negotiate a contract with one of the recommended firms using an appropriate alternative negotiation method for which compensation is not the sole or predominant factor used to select the firm. (d) In negotiations with firms under this section, the governing body may allow a designee to conduct negotiations on its behalf. (5) The method used by the governing body to select a firm recommended by the audit committee and negotiate a contract with such firm must ensure that the agreed-upon compensation is reasonable to satisfy the requirements of s. 218.32 and the needs of the governing body. (6) If the governing body is unable to negotiate a satisfactory contract with any of the recommended firms, the committee shall recommend additional firms, and negotiations shall continue in accordance with this section until an agreement is reached. (7) Every procurement of audit services shall be evidenced by a written contract embodying all provisions and conditions of the procurement of such services. For purposes of this section, an engagement letter signed and executed by both parties shall constitute a written contract. The written contract shall, at a minimum, include the following: (a) A provision specifying the services to be provided and fees or other compensation for such services. (b) A provision requiring that invoices for fees or other compensation be submitted in sufficient detail to demonstrate compliance with the terms of the contract. (c) A provision specifying the contract period, including renewals, and conditions under which the contract may be terminated or renewed. (8) Written contracts entered into pursuant to subsection (7) may be renewed. Such renewals may be done without the use of the auditor selection procedures provided in this section. Renewal of a contract shall be in writing. History.--s. 65, ch. 2001-266; s. 1, ch. 2005-32. Copyright @ 1995-2006 The Florida Legislature. Privacy Statement. Contact Us http://www.1eg.state.fl.us/Statutes/index.cfm? App _ mode=Display _ Statute&Search _ String=&URL=Ch02... 6/20/2007 Statutes & Constitution :View Statutes: Online Sunshine Page 22 of 49 (3) No violation of this section shall affect the validity of the bond issue. History.--s. 2, ch. 80-98; s. 3, ch. 82-195. 218.39 Annual financial audit reports.-- (1) If, by the first day in any fiscal year, a local governmental entity, district school board, charter school, or charter technical career center has not been notified that a financial audit for that fiscal year will be performed by the Auditor General, each of the following entities shall have an annual financial audit of its accounts and records completed within 12 months after the end of its fiscal year by an independent certified public accountant retained by it and paid from its public funds: (a) Each county. (b) Any municipality with revenues or the total of expenditures and expenses in excess of $250,000. (c) Any special district with revenues or the total of expenditures and expenses in excess of $100,000. (d) Each district school board. (e) Each charter school established under s. 1002.33. (f) Each charter technical center established under s. 1002.34. (g) Each municipality with revenues or the total of expenditures and expenses between $100,000 and $250,000 that has not been subject to a financial audit pursuant to this subsection for the 2 preceding fiscal years. (h) Each special district with revenues or the total of expenditures and expenses between $50,000 and $100,000 that has not been subject to a financial audit pursuant to this subsection for the 2 preceding fiscal years. (2) The county audit report shall be a single document that includes a financial audit of the county as a whole and, for each county agency other than a board of county commissioners, an audit of its financial accounts and records, including reports on compliance and internal control, management letters, and financial statements as required by rules adopted by the Auditor General. In addition to such requirements, if a board of county commissioners elects to have a separate audit of its financial accounts and records in the manner required by rules adopted by the Auditor General for other county agencies, such separate audit shall be included in the county audit report. (3)(a) A dependent special district may make provision for an annual financial audit by being included within the audit of another local governmental entity upon which it is dependent. An independent special district may not make provision for an annual financial audit by being included within the audit of another local governmental entity. (b) A special district that is a component unit, as defined by generally accepted accounting principles, of a local governmental entity shall provide the local governmental entity, within a reasonable time period as established by the local governmental entity, with financial information necessary to comply with this section. The failure of a component unit to provide this financial information must be noted in the annual financial audit report of the local governmental entity. (4) A management letter shall be prepared and included as a part of each financial audit report. http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=Ch02l8/ch0218.htm 6/19/2007 Statutes & Constitution :View Statutes: Online Sunshine Page 23 of 49 (5) At the conclusion of the audit, the auditor shall discuss with the chair of each local governmental entity or the chair's designee, or with the elected official of each county agency or with the elected official's designee, or with the chair of the district school board or the chair's designee, or with the chair of the board of the charter school or the chair's designee, or with the chair of the charter technical career center or the chair's designee, as appropriate, all of the auditor's comments that will be included in the audit report. If the officer is not available to discuss the auditor's comments, their discussion is presumed when the comments are delivered in writing to his or her office. The auditor shall notify each member of the governing body of a local governmental entity, district school board, or charter school for which deteriorating financial conditions exist that may cause a condition described in s. 218.503(1) to occur if actions are not taken to address such conditions. (6) The officer's written statement of explanation or rebuttal concerning the auditor's findings, including corrective action to be taken, must be filed with the governing body of the local governmental entity, district school board, charter school, or charter technical career center within 30 days after the delivery of the auditor's findings. (7) The predecessor auditor of a district school board shall provide the Auditor General access to the prior year's working papers in accordance with the Statements on Auditing Standards, including documentation of planning, internal control, audit results, and other matters of continuing accounting and auditing significance, such as the working paper analysis of balance sheet accounts and those relating to contingencies. (8) All audits conducted in accordance with this section must be conducted in accordance with the rules of the Auditor General promulgated pursuant to s. 11.45. All audit reports and the officer's written statement of explanation or rebuttal must be submitted to the Auditor General within 45 days after delivery of the audit report to the entity's governing body, but no later than 12 months after the end of the fiscal year. (9) Each charter school and charter technical career center must file a copy of its audit report with the sponsoring entity; the local district school board, if not the sponsoring entity; the Auditor General; and with the Department of Education. (10) This section does not apply to housing authorities created under chapter 421. (11) Notwithstanding the provisions of any local law, the provisions of this section shall govern. History.--s. 65, ch. 2001-266; s. 924, ch. 2002-387; s. 28, ch. 2004-305; s. 2, ch. 2006-190. 218.391 Auditor selection procedures.-- (1) Each local governmental entity, district school board, charter school, or charter technical career center, prior to entering into a written contract pursuant to subsection (7), except as provided in subsection (8), shall use auditor selection procedures when selecting an auditor to conduct the annual financial audit required in s. 218.39. (2) The governing body of a charter county, municipality, special district, district school board, charter school, or charter technical career center shall establish an audit committee. Each noncharter county shall establish an audit committee that, at a minimum, shall consist of each of the county officers elected pursuant to s. 1 (d), Art. VIII of the State Constitution, or a designee, and one member of the board of county commissioners or its designee. The primary purpose of the audit committee is to assist the governing body in selecting an auditor to conduct the annual financial audit required in s. 218.39; however, the audit committee may serve other audit oversight purposes as determined by the entity's governing body. The public shall not be excluded from the proceedings under this section. (3) The audit committee shall: http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=Ch02l8/ch02l8.htm 6/19/2007 Statutes & Constitution :View Statutes: Online Sunshine Page 24 of 49 (a) Establish factors to use for the evaluation of audit services to be provided by a certified public accounting firm duly licensed under chapter 473 and qualified to conduct audits in accordance with government auditing standards as adopted by the Florida Board of Accountancy. Such factors shall include, but are not limited to, ability of personnel, experience, ability to furnish the required services, and such other factors as may be determined by the committee to be applicable to its particular requirements. (b) Publicly announce requests for proposals. Public announcements must include, at a minimum, a brief description of the audit and indicate how interested firms can apply for consideration. (c) Provide interested firms with a request for proposal. The request for proposal shall include information on how proposals are to be evaluated and such other information the committee determines is necessary for the firm to prepare a proposal. (d) Evaluate proposals provided by qualified firms. If compensation is one of the factors established pursuant to paragraph (a), it shall not be the sole or predominant factor used to evaluate proposals. (e) Rank and recommend in order of preference no fewer than three firms deemed to be the most highly qualified to perform the required services after considering the factors established pursuant to paragraph (a). If fewer than three firms respond to the request for proposal, the committee shall recommend such firms as it deems to be the most highly qualified. (4) The governing body shall inquire of qualified firms as to the basis of compensation, select one of the firms recommended by the audit committee, and negotiate a contract, using one of the following methods: (a) If compensation is not one of the factors established pursuant to paragraph (3)(a) and not used to evaluate firms pursuant to paragraph (3)(e), the governing body shall negotiate a contract with the firm ranked first. If the governing body is unable to negotiate a satisfactory contract with that firm, negotiations with that firm shall be formally terminated, and the governing body shall then undertake negotiations with the second-ranked firm. Failing accord with the second-ranked firm, negotiations shall then be terminated with that firm and undertaken with the third-ranked firm. Negotiations with the other ranked firms shall be undertaken in the same manner. The governing body, in negotiating with firms, may reopen formal negotiations with anyone of the three top-ranked firms, but it may not negotiate with more than one firm at a time. (b) If compensation is one of the factors established pursuant to paragraph (3)(a) and used in the evaluation of proposals pursuant to paragraph (3)(d), the governing body shall select the highest-ranked qualified firm or must document in its public records the reason for not selecting the highest-ranked qualified firm. (c) The governing body may select a firm recommended by the audit committee and negotiate a contract with one of the recommended firms using an appropriate alternative negotiation method for which compensation is not the sole or predominant factor used to seleCt the firm. (d) In negotiations with firms under this section, the governing body may allow a designee to conduct negotiations on its behalf. (5) The method used by the governing body to select a firm recommended by the audit committee and negotiate a contract with such firm must ensure that the agreed-upon compensation is reasonable to satisfy the requirements of s. 218.39 and the needs of the governing body. (6) If the governing body is unable to negotiate a satisfactory contract with any of the recommended firms, the http://www.1eg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=Ch02l8/ch02l8.htm 6/19/2007 Statutes & Constitution :View Statutes: Online Sunshine Page 25 of 49 committee shall recommend additional firms, and negotiations shall continue in accordance with this section until an agreement is reached. (7) Every procurement of audit services shall be evidenced by a written contract embodying all provisions and conditions of the procurement of such services. For purposes of this section, an engagement letter signed and executed by both parties shall constitute a written contract. The written contract shall, at a minimum, include the following: (a) A provision specifying the services to be provided and fees or other compensation for such services. (b) A provision requiring that invoices for fees or other compensation be submitted in sufficient detail to demonstrate compliance with the terms of the contract. (c) A provision specifying the contract period, including renewals, and conditions under which the contract may be terminated or renewed. (8) Written contracts entered into pursuant to subsection (7) may be renewed. Such renewals may be done without the use of the auditor selection procedures provided in this section. Renewal of a contract shall be in writing. History.--s. 65, ch. 2001-266; s. 1, ch. 2005-32. PART IV INVESTMENT OF LOCAL GOVERNMENT SURPLUS FUNDS 218.40 Short title. 218.401 Purpose. 218.403 Definitions. 218.405 Local Government Surplus Funds Trust Fund; creation. 218.407 Local government investment authority. 218.409 Administration of the trust fund. 218.411 Authorization for state technical and advisory assistance. 218.412 Rulemaking authority. 218.415 Local government investment policies. 218.40 Short title.--This part shall be known, and may be cited, as the "Investment of Local Government Surplus Funds Act." History.--s. 1, ch. 77-394. 218.401 Purpose.--It is the intent of this part to promote, through state assistance, the maximization of net interest http://www.1eg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=Ch0218/ch0218.htm 6/19/2007 ~ 4.08 WINTER SPRINGS CODE authorized by law or forfeiture of his office, or in the event no one is elected to the office of mayor or . commission member. (b) Forfeiture of office. A commissioner or mayor shall forfeit his office if he: (1) Lacks at any time during his term of office any qualifications prescribed by this Char- ter or by law; or (2) Knowingly and willfully violates anyex- press prohibition of this Charter; or (3) Is convicted of a felony; or (4) Fails to attend three (3) consecutive reg~ ular meetings of the commission without being duly excused by the commission. (c) Filling of vacancies. A vacancy in a commis- sion member's seat shall be filled until the next regular election to be held for the office of the commissioner from that seat by a msjority vote of all its remaining members. Section 4.09. Judge of qualifications. The commission shall be the judge of the elec- tion and qualifications of its members and of the grounds of forfeiture of their office and for that purpose shall have power to subpoena witnesses, administer oaths and require production of evi- dence. A member charged with conduct constitut- ing grounds for forfeiture of his office shall be so notified by certified mail and shall be entitled to a public hearing on demand, and notice of such hearing shall be published in one or more news- papers of a general circulation in the city at least one week in advance of the hearing. Decisions made by the commission under this section shall be subject to review by the courts. Section 4.10. City clerk. (a) The city commission, after receiving a nom- ination from either the mayor or a commission member(s) shall, by a vote of not less than four (4) commission members, appoint an officer of the city who shall have the title of city clerk. The city clerk shall give notice of commission meetings to its members and the public, keep the journal ofits Supp. No.2 proceedings and perform such other duties as are provided by tbis Charter, by the commission or by law. (b) The city clerk may be removed by a vote of not less than four (4) commission members. Section 4.11. Investigations. The commission may make investigations into the affairs of the city and the conduct of any city department, office or agency and fl?r this purpose may subpoena witnesses, administer oaths, take testimony and require the production of evidence. Any person who fails or refuses to obey a lawful order issued in the exercise of these powers by the commission shall be guilty of a misdemeanor and punishable by a fine of not more than five hun- dred dollars ($500.00) or by imprisonment for not more than ninety (90) days or both. Section 4.12. Independent audits. The commission shall provide for an indepen- dent audit of all city accounts and may provide for such more frequent audits as it deems necessary. Such audits shall be. made by a certified public accountant or firm of accountants who have no personal interest, direct or indirect in the fiscal affairs of the city government or any ofits officers. The commission may designate such accountant or firm annually or for a period not exceeding three (3) years provided that the designation for any particular fiscal year shall be made no later than six (6) months after the beginning of such fiscal year. If the state makes such an audit the commission may accept it as satisfying the re- quirement of this section. Section 4.18. Procedure. (a) Meetings. The commission shall meet reg- ularly at least once every month at such times and places as the commission may prescribe by rule. Special meetings shall be held on the call of the mayor or three (3) or more members and whenever practicable, upon no less than twelve (12) hours' notice to each member. All meetings shall be public. 6 REQUEST FOR PROPOSAL. RFP # 006/07/MG . AUDIT SERVICES The City of Winter Springs, Florida invites Independent Certified Public Accountants, who are licensed to practice in the State of Florida, to submit proposals for the performance of an examination of Winter Springs' financial statements. The purpose of the examination is to express an opinion on the fairness with which the financial statements present the City's financial position, changes in financial position and cash flow and budgetary comparisons for major funds in conformity with generally accepted governmental accounting principles, and to determine whether operations were conducted in accordance with legal and regulatory requirements. A. General Information 1. The City will contract for the annual audit for fiscal years ending September 30, 2007,2008 and 2009 with the option of three one-year renewals. 2. Winter Springs, Florida is a City Commission/City Manager form of municipal government. The City is primarily a retail, office and residential area with a population of approximately 34,600. The City employs approximately 292 full- time employees (and 12.19 part-time equivalents) and administers a combined budget of $62,000,000. 3. Copies of the City's Annual Financial Report for fiscal year ended September 30, 2006, which included an unqualified audit opinion, can be found on the City's website at: www .winterspringsfl.org/EN/main/documents/forms_publications/finance_ budgetlcafr2006.html, and the 2007 Annual Budget at: www .winterspringsfl.org/EN/main/documents/forms_publications/finance_ budgetlfi nal budget2007. htm. 4. The City's accounting system is substantially fully automated. The City's mainframe computer is run on a UNIX platform but will be converting to a Windows/SOL platform in the near future. All Finance Department personnel have connection via personal computers. General Ledger, Fixed Assets, Purchasing, Cash Receipts, and Utility Billing systems are fully automated. Budgets are initially recorded in the automated accounting system, and amendments and transfers are subsequently documented within the system. 5. Audits for the fiscal years ending September 30, 2000 - 2006 have been performed by McDirmit Davis and Company, LLC of Orlando, Florida. 6. The City has no internal audit department. Finance personnel working on the audit includes the Finance Director, City Controller, Management and Budget Analyst, Revenue Manager, Utility Billing Manager and two staff accountants. Finance personnel are committed to furnishing documents and preparing audit work schedules and being available to assist with the preparation of any additional information needed. Financial statements will be prepared by the City. The Accounting staff will provide the following statements and schedules for the auditor: Bank Confirmations Investment Confirmations Revenue Confirmations Debt Compliance Confirmations Legal Confirmations Compensated Absence Schedules Accrued Liabilities Schedule Receivable Schedules Bank Reconciliation Pension Investment Statements and Schedules Investment Statements Investments & Demand Accounts Schedule Pooled Cash Summary, with Investments apportioned calculation Accounts Payable Schedules Encumbrance Schedule Interfund Account Schedules, including interfund transfers Contracts and Retainage Payable Schedule Fixed Asset Schedules, including CIP Schedules and Contributed Capital Schedules Long-Term Debt Schedules Designated/Reserve Fund Equity Schedules Various Revenue and Expense Schedules Due TolDue From Schedules Inventory Schedules Prepaid costs Schedules Trial balances for each fund Copy of current Budget document and Budget Amendments Management's Discussion and Analysis Basic Financial Statements, including Notes Required Supplementary Information Combining Major Fund and Non-major Fund Statements Statistical Section State Banking & Finance Report Other schedules may be added and others may be deleted based on the pre- audit planning conference. 7. The City is a recipient of various grants, none of which are anticipated to be a major program for the fiscal year ending September 30,2007. 8. The entity to be audited includes the following fund types: General Fund Special Revenue Funds (21) Debt Service Funds (7) Capital Projects Funds (9) Enterprise Funds (3) Fiduciary Fund (1) The City has no component units. 2 9. The City has received the Government Finance Officers Associations Certificate of Achievement for Excellence in Financial Reporting since 2000. 10. The City began implementation of GASB 34 with FY 2002. B. Performance Specifications: 1. To be eligible to qualify as an external auditor, the following minimum requirements must be met: a) The firm must be established as a legal entity and be licensed in the State of Florida. The principals of the firm must have performed continuous auditing services to local governments for a minimum of five (5) years. b) The firm must meet the independence and education requirements of the Government Auditing Standards issued by the Comptroller General of the United States. c) The firm must have no record of sub-standard audit work. d) The firm must be a member of the American Institute of Certified Public Accountants, the Florida Institute of Certified Public Accountants, and the Government Finance Officers Association. e) All individuals who will be working on the auditmust have at least 24 hours of governmental accounting and auditing CPE. 2. The audit shall be performed in compliance with the following as they exist or as each may be subsequently amended: a) Generally Accepted Auditing Standards. b) Governmental Auditing Standards issued by the Comptroller General of the United States. c) Rules adopted by Auditor General for form and content of local governmental unit audits, Chapter 10.550. d) Audits of State and Local Governmental Units (AICPA Audit Guide Revised). e) Single Audit Act of 1984 and OMB Circular A-133. 3. The audit shall be a financial audit as defined in Sec. 11.45(1) (c), Florida Statutes. 4. The audit is to be conducted and the statements prepared in accordance with GASB 34, and the audit shall include a review and evaluation of the City's system of internal accounting controls. 5. The auditor shall submit, no later than fifteen (15) days after the end of field work, a draft of the management letter, which shall identify weaknesses observed in the system of internal accounting controls, assess their effect on the system and propose steps to eliminate such weaknesses. 6. Working papers are the property of the auditor and should be held locally for a period of five (5) years. Working papers will be available for examination or duplication without charge to authorized City personnel as well as representatives of the cognizant Federal Audit Agency, the General Accounting Office, the State of Florida Auditor General or the State Board of Accountancy. They will be made available for examination or duplication at a reasonable charge to subsequent auditors engaged by the City. 7. The auditor will agree to immediately notify the City if the Board of Accountancy or any other regulatory agency requests a review of the audit work papers concerning the City or any government client audited by the firm's local office. 8. The City will expect immediate compliance with any expanded scope definitions and will consider fee adjustment where significant change can be demonstrated which will materially affect what the City should have expected the auditor to accomplish at the time of fee determination. 3 9. The Auditor will assist the City in complying with changes in reporting requirements to remain in conformity with Generally Accepted Accounting Principles. This may include technical assistance in preparation of new statements and footnote disclosure. 10. If the City issues debt during the contract period for which the official statement contains financial statements and the report of independent accounts, the firm shall be required to issue a "consent and citation of expertise" as auditor and any necessary "comfort letters" at a cost to be negotiated with the City. c. Instructions for Proposals: 1. All firms submitting a proposal will need to submit one marked original and five (5) sets of their documents in a sealed envelope. The left front of the package shall read: Request for Proposals to Provide Audit Services RFP # 006/07/MG Due Date: July 20,2007 - Time 5:00 PM Company Name and Address Documents will need to be delivered or hand-delivered to: Attn: Purchasing Department City of Winter Springs 1126 East S.R. 434 Winter Springs, FL 32708 2. Proposals must be received by the City not later than 5:00 p.m. on Friday, July 20,2007, in order to be considered. 3. Proposals must be delivered in a sealed envelope or sealed box with the name of the proposer and RFP # 006/07/MG Audit Services clearly marked on the outside for easy identification. No facsimile or telegraphic proposal submissions will be accepted. 4. Cost of the preparation and submittal of proposals is an operational cost of the proposer, and the City of Winter Springs shall not be responsible for any such costs incurred. 5. Questions regarding RFP # 006/07/MG Audit Services should be in writing and emailed to mareco@wintersprinasfl.ora with the subject RFP # 006/07/MG Audit Services - Questions before July 9, 2007 at 5:00 PM. D. Information to be included in the Proposal: 1. Title Page - The proposer should identify the RFP number and subject, the name of the firm, local address, telephone number, name and title of contact person, and date of submission. 2. Table of Contents - Provide a clear identification of the material by section and by page number. 3. Letter of Transmittal - Should be brief, and introductory in nature. 4. A statement setting forth the proposer's understanding of the work to be done, a brief description of the audit procedures to be followed and major areas of emphasis, and a tentative schedule for performing the key phases of the audit. 5. An express agreement to meet or exceed Performance Specifications listed in Section B. List any exceptions taken to these specifications. 4 6. Description and history of the firm, including whether the firm is local, regional or national. Provide the number of employees corporate wide and number of offices in the State of Florida, and the number of employees employed in the State of Florida. Provide how long the corporation has been in its current form, how long the corporation has been in existence in any form and, if necessary, the changing corporate culture. 7. The location of the office from which the work is to be done, the number of personnel in that office who would be assigned to the engagement and the relevant prior governmental auditing experience, background and qualifications of those assigned personnel. Firm-wide experience may be submitted in addition to, but not in lieu of, the assigned office's or staff's experience. 8. An identification of the partners, managers and supervisors who will work on the audit as well as be assigned to review or quality control functions, including staff from other than the local office if necessary for the audit. Whether members of the proposed audit team are employees of the firm or are contracted consultants should be noted. Also indicate persons authorized to represent and commit the firm, including business address and phone number. Resumes for each managerial and supervisory person to be assigned to the audit should be submitted and include the following information: a) Formal education. b) Supplemental education relative to governmental accounting and auditing. c) Experience in public accounting in general. d) Experience in private business or government. e) Experience with governmental units. f) Experience with preparation of GASB 34 statements. g) Experience and expertise in auditing computer systems. h) Membership in various national and state governmental accounting boards, committees, or associations (past and present). i) Professional recognition, such as Certified Public Accounting licenses, certifications, awards, etc. It is understood that managerial, supervisory and audit staff may be changed for a variety of reasons. Replacements may be made at the discretion of the proposer, provided there is no compromise in qualifications or experience and replacements (new staff) are acceptable to the City. 9. A description of the office's experience in preparing GASB 34 financial statements and in providing assistance in obtaining the Certificate of Achievement. List those municipalities for whom you currently prepare or have prepared a CAFR in accordance with GASB 34, and those who received the Certificate of Achievement during your tenure as auditor. 10. A current listing of Florida municipalities for which the firm is providing or has provided auditing services, the scope of such service, and the time periods of such service. Please provide a contact person, address and phone number, as these clients may be contacted for references. Please provide the total number of awards that are serviced from this local office. 11. A description of the firm's approach to peer review and a copy of the most recent peer review report. Indicate whether that peer review included a review of local government client activities. 12. Describe the audit approach that the firm will use in providing the services described in the performance specifications' section to include, but not limited to, the number of hours of staff time at each level that will be devoted to each 5 segment and the approach for gaming and documenting the auditor's understanding of the government's internal controls. 13. Firm promotional material may also be included as supplemental information; however, it will not be considered a substitute for the proposal. 14. Disclosure of any unresolved or pending regulatory disciplinary actions and/or litigation including negative declaration if applicable. 15. Formal statement that your firm meets all appropriate guidelines for independence. 16. Provide with your proposal and include a proposed fee schedule for the services listed in Performance Specifications Section B above in a se"arate sealed envelo"e that;s clearlv marked "Pro"osed Fee Schedule". The fee schedule will not be opened nor will it be given consideration until all proposals have been evaluated based on criteria described below in Section E. The fee proposed by the highest ranked firm will be subject to negotiation and final acceptance and approval by the City of Winter Springs. E. Evaluation Procedure: The City desires to award the contract to the most responsive and responsible proposer that demonstrates the ability to provide the highest quality of service at the best cost. To accomplish this goal, the city's criteria for selection shall include, but not be limited to, the following: Evaluation Criteria Points 1. The firm's specific municipal audit experience with 20 municipalities of comparable size. 2. Professional certification, education and experience of 20 personnel to be assigned to the audit. 3. Understanding of the scope of services to be provided as 10 demonstrated by the stated audit approach. 4. Responses of references. 5 5. Past, current and projected work assignments of assigned 10 audit staff. 6. History of performing quality audits as demonstrated by 5 recent peer review report. 7. Willingness to meet the City's timeline (fieldwork start date 15 in November, CAFR issuance by end of January). 8. Location within 50 miles of the City of Winter Springs. 5 9. Overall presentation of proposal and oral presentation. 10 .1QQ 6 PLEASE NOTE THAT A FEE PROPOSAL IS TO BE INCLUDED IN A SEPARATE SEALED ENVELOPE WITH THIS PROPOSAL. F. Selection Process: A three-member Auditor Selection Committee will consist of the City Manager (or his designee), Finance Director and a City Commissioner. The Auditor Selection Committee will evaluate and rank proposals based on a weighted score point formula. The Committee will select a list of not less than five firms as finalists for oral presentations and interviews. After oral presentations and interviews with each of the five firms, the Committee will rank the finalists, open the fee schedule and undertake fee negotiations with the top-ranking finalist. Should agreement not be reached, negotiations will begin with the remaining firms in ranking order. The Auditor Selection Committee will then present a recommendation to the City Commission on August 27,2007. G. Terms and Conditions: 1. All responses shall become the property of the City of Winter Springs. 2. Proposals shall be prepared simply, providing straightforward responses to satisfy the requirements of this RFP. 3. Each firm shall examine all parts of this RFP and shall determine all matters relating to the interpretation of such documents. Only those firms that have received and responded to this RFP will be considered. Any changes to the RFP will be addressed by addenda to all firms who have received this RFP. 4. A response to this RFP does not constitute a bid; therefore, the City retains their right to contact any/all proposers after submittal in order to obtain supplemental information and/or clarification. 5. All questions for clarification or additional information should be directed to the Finance Director as noted in section CS. No other City Staff, Board members, Commission members, or contracted consultants shall be contacted. Such unauthorized contact shall be cause for disqualification. 6. The City reserves the right to accept or reject any and all submittals received, to waive irregularities and technicalities, and to request re-submission or to re- advertise for all or any part of the RFP. The City shall be the sole judge of the proposal and the resulting negotiated agreement that is in the City's best interest, and the City's decision shall be final. 7. The City reserves the right to approve or reject any subcontracting firms after initial contract approval. H. Reauest for Additional Information: The proposer shall furnish such additional information as the City may reasonably require. This includes information which indicates financial resources as well as ability to provide and maintain the system and/or services. The City reserves the right to make investigations of the qualifications of the proposer or any of its agents as it deems appropriate. I. Addendum and Amendment to Reauest for Proposals: If it becomes necessary to revise or amend any part of this Request for Proposal, the revision will be furnished by written Addendum to all prospective proposers who received a Request for Proposal. 7 J. Billinas and Payment: Progress payments not to exceed 80% of the total annual fee will be made on receipt of invoice from the proposer, in accordance with a mutually agreed schedule. Final payment will be made upon receipt and acceptance of final audit reports, opinion letters and management letter. K. On-Site Inspections: Proposers are welcome to inspect recent CAFRs and the current budget via the City's website as noted in Section A3 or to make an on-site inspection of City facilities in connection with preparing proposals, providing that arrangements are made in advance with the Finance Director. L. Non-Collusion: By offering submission to the RFP, the proposer certifies the proposer has not divulged to, discussed or compared his/her proposal with other proposers or parties to this proposal whatsoever. M. Public Entitv Crimes: A person or affiliate who has been placed on the convicted vendor list following a conviction for a public entity crime may not submit a bid on a contract to provide any goods or services to a public entity, may not submit a bid on a contract with a public entity for the construction or repair of a public building or public work, may not submit bids on leases or real property to a public entity, may not be awarded or perform work as a contractor, supplier, subcontractor or consultant under a contract with any public entity, and may not transact business with any public entity in excess of the threshold amount provided in Section 287.017, for CATEGORY TWO, for a period of 36 months from the date of being placed on the convicted vendor list. N. Additional Information: Requests for additional information should be made as per instructions in Section C5. NOTE: All prospective proposers are hereby cautioned not to contact any member of the City of Winter Springs' Commission, or any other staff member except the Finance Director, regarding this proposal. Such unauthorized contact shall be cause for disqualification. 8 PROPOSED TIME SCHEDULE FOR SELECTION OF AUDITORS RFP's Mailed Return Deadline for RFP's - (5:00 P.M.) RFP's Submitted to Auditor Selection Committee Preliminary Ranking to Determine Finalists Schedule Oral Presentations Oral Presentations of Firm Finalists Final Ranking by Committee Complete Contract Negotiations Recommended Contract Presented to Commission June 26, 2007 July 20, 2007 July 23, 2007 July 30,2007 July 31,2007 August 6, 2007 August6,2007 August 7,2007 August 25, 2007 9 AFFIDAVIT OF NON-COLLUSION AND OF NON-INTEREST OF CITY EMPLOYEES Description of Contract: AUDIT SERVICES FOR THE CITY OF WINTER SPRINGS, FLORIDA STATE: COUNTY OF: FLORIDA SEMINOLE Name of company responding Name of authorized individual signing being the first duly sworn, deposes and says that he/she is the respondent in the above proposal, that the only person or persons interested in said proposal are named therein; that no officer, employee or agent of the City of Winter Springs or of any other party is interested in said request for proposal; and that affiant makes the above proposal with no past or present collusion with any other person, firm or corporation. Company Signature Sworn and subscribed before me this 20 , in the State of Florida, County of day of Notary Public My Commission Expires: 10 CITY OF WINTER SPRINGS, FLORIDA STATEMENT OF "NO PROPOSAL" If you do not intend to respond to this Request for Proposal, please complete and return this form prior to the date shown for receipt of proposals to: Attn: Purchasing Department City of Winter Springs 1126 East S.R. 434 Winter Springs, FL 32708 We, the undersigned, have declined to propose on RFP # 006/07/MG, audit services, for the following reasons: Date: Signature: Company Name: Phone Number: 11